QualityDipStocks / Technology · Software & internet services
Zoom Communications ZM
On dip watch: 15% below its 52-week high.
A quality company trading near our fair value estimate.
- Fair value est.
- $104.64+10%
- Market Value
- $94.87price +1%
- Off 52-wk high
- −15%
- Risk vs market
- Market-likebeta 1.05
5 bullish · 2 bearish See why
Key levels
Every level vs today’s $95.50
- 52-wk lowlowest close, 1 year$72.72−23.9%
- Market Valueavg paid since Aug 25$94.87−0.7%
- PriceFri Oct 30 close$95.50you are here
- Fair value est.base case$104.64+9.6%
- 52-wk highhighest close, 1 year$111.88+17.2%
Fair value estimate
How the range is computed
Ten-year free-cash-flow DCF. Same 10-year free-cash-flow model as the base: discount rate 9.5% ±1 point and growth 3.5% ±2 points. Bear = 10.5% and 1.5%; bull = 8.5% and 5.5% (both fade to 3%). A model estimate from public filings, not a forecast of where the price will go.
Price sits inside the range.
What the price implies To be worth today’s price, ZM’s free cash flow would need to grow about 2% a year for five years; our estimate uses 3%.
Risk vs market
How risk vs market is measured
One year of daily returns (Oct 30 to Oct 30, 252 sessions). Beta = how much ZM moved for each 1% move in the S&P 500 (SPY); 1.0 moves with the market. Volatility is the yearly standard deviation of daily returns. Past behavior, not a forecast.
Moves about in line with the market, and its own price swings are 3.5× the S&P 500’s.
- Beta vs S&P 500
- 1.05
- Volatility
- 45% vs 13% SPY
- Correlation SPY
- 0.30
- Correlation QQQ
- 0.27
Bull vs bear
Rule-based from the data on this page, strongest first. Not advice.
Top bullish points 5 of 5
ValuationP/E of 8.8× is 64% below its own average of 24.4× at the last 3 fiscal year-ends.
GrowthDiluted EPS grew 93% to $6.18 in FY2026.
ProfitabilityOperating margin widened to 23.1% in FY2026 from 11.6% in FY2024 (SEC filings).
ValuationP/E of 8.8× vs a 33.9× median for the 138 Technology companies we cover.
ValuationFree-cash-flow yield of 6.7% (price / FCF 14.9×): $1.9B of free cash in the last 12 months.
Top bearish points 2 of 5
GrowthSales grew 5.0% over the last 12 months, below the 18% median for the 163 Technology companies we cover.
GrowthSales grew only 3.5% a year from FY2023 to FY2026.
Who’s talking about it
Notable investors, executives, analysts and public figures on Zoom Communications in the last 48 hours. Headlines as published, each linked. Their words, not ours.
No notable mentions in the last 48 hours. Checked Nov 1, 9:09 PM ET.
Compare with peers
Closest in size in Software & internet services
All fundamentals
P/E 8.8 · FCF yield 6.7% · ROE 32%
Valuation
- P/E
- 8.8×3-yr-end avg 24.4× · Technology median 33.9×
- Price / FCF
- 14.9×
- FCF yield
- 6.7%
- EV / EBITDA
- n/aD&A or debt not tagged in SEC data
- Price / sales
- 5.73×
- Price / book
- 2.53×
- Market cap
- $28.6Bprice × diluted shares
- Enterprise value
- n/anot reported in its SEC filings
Growth
- Revenue, 12 months
- $5.0B
- Sales growth, 12 months
- +5.0%vs the 12 months before
- Sales growth, 3 yrs
- +3.5%/yrfrom FY2023
- Diluted EPS, 12 months
- $10.77
- EPS growth, last FY
- +92.5%
- Net income, 12 months
- $3.3B
- Net income growth
- +174%12 months vs before
Profitability
- Gross margin
- 77.3%
- Operating margin
- 23.7%
- Net margin
- 65.2%
- FCF margin
- 38.6%
- Return on equity
- 32%
- Return on invested capital
- n/aoperating income, debt, equity or cash not tagged
Balance sheet
- Cash & short-term inv.
- $7.2B
- Total debt
- n/anot reported in its SEC filings
- Net cash
- n/acash or debt not tagged in SEC data
- Debt / equity
- n/adebt or equity not tagged in SEC data
- Interest coverage
- n/ainterest expense not tagged in SEC data
Cash flow & returns
- Free cash flow, 12 months
- $1.9B
- FCF growth, 12 months
- +4%
- Dividend yield
- 0%
- Payout ratio
- n/anot reported in its SEC filings
- Buybacks, 12 months
- $1.5B5.1% of market cap
- Share count, 1 year
- −2.8%diluted shares vs a year ago
- Stock-based comp
- $729M
Trailing 12 months to Jul 31, 2026; balance sheet at Jul 31, 2026. From Zoom Communications’s SEC filings. Sparklines show up to six fiscal years. n/a means we don’t hold that number, with the reason. How each is computed.
Valuation details
DCF $104.64 · MV $94.87 · FCF value $161.68
Assumes 3.5% growth for 5 years (revenue grew 3.5% a year FY23–FY26), fading to 3%; 9.5% discount rate, 3% terminal growth. FCF base $6.42 a share (trailing 12 months to Jul 31, 2026), from the 10-Q filed Aug 26, 2026.
Setup & signals
No setup armed
No setup armed, so there’s no trigger or stop to track yet. We watch it daily for our three reversal signal rules while it sits in a dip.
Momentum & 52-week range
RSI 49 · 5 days −0.3%
The business
FCF $1.9B · Sales +5%
- Free cash flow, 12 months$1.9B
- Free-cash-flow yield6.8%
- Free-cash-flow margin39%
- Gross margin77%
- Operating margin24%
- Return on invested capital8%
- Return on equity33%
- Sales growth (latest quarter vs year-ago quarter)+5%
- Net debt / EBITDA−0.7×
Next report
Nov 23
- DateMon Nov 23
- Consensus EPS$1
- Year-ago EPS$0.89
- QuarterOct/2026
From Nasdaq’s earnings calendar. A report resets Market Value.
Information only, not investment advice. Fair value estimates and talking points are rule-based model output from public data and can be wrong; stop levels are reference points, not orders. How every number is computed.
Get a text when ZM fires a reversal signal
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